Alternative finance has seemingly burst on the scene in recent years. The movement has picked up momentum in a major way, but where did the ideas of alternative finance come from, and why have they had such a strong impact on the financial world? Here’s a look back at the history of alternative finance.
The basic idea of alternative financing is a simple one: customers should have alternative options for financial services outside of traditional banks and their high regulations and low approval rates. We have found examples of alternative finance dating back hundreds of years. Irishman Jonathan Swift influenced the Irish Loan Fund way back in the 1700s. Swift, who some have called the “father of microcredit,” established the fund to provide loans to poor rural families who had no credit history and very little collateral. The Irish Loan Fund would make small loans of 5 to 10 pounds and require weekly repayments of as little as 2 shillings at a time. Swift also required each borrower to have two neighbors as “co-signers” that would guarantee the loan if payments were missed. Swift recognized that, just because many of these people didn’t fit the mold of traditional “credit-worthy” borrowers, the vast majority of them were honest, hard-working people that would make their payments on time. These people needed financial services and he opened up a world of financial freedom to them outside of the traditional financial framework at the time. Another powerful example of alternative finance in history involves The Statue of Liberty. Crowdfunding involves pooling the capital of a number of small investors to reach a large fundraising goal. There’s no telling how far back this practice goes, but thanks to Joseph Pulitzer, crowdfunding is responsible for one of the most iconic American monuments: the Statue of Liberty. It’s a common bit of U.S. trivia that the Statue of Liberty was a gift from France, but apparently the pedestal on which it stands on Liberty Island was not part of the deal. When the construction of the pedestal ran into funding issues, Pulitzer stepped in and launched a 19th-century version of a crowdfunding campaign. Pulitzer made his case for donations to the project via his newspaper, the New York World, back in 1885. Pulitzer’s drive raised more than $100,000 in six months from more than 125,000 contributors, many of which gave $1 or less to the cause. However, the efforts demonstrated the combined power of a large group of small investors.
Technology has been one of the reasons alternative finance has been able to come alive in the modern era. The Internet Age has made it possible for fintech companies to compete with large banks better than any other time in history. Alternative finance companies, such as marketplace lenders, Zopa (2004) and OnDeck Capital (2006) began popping up in the early 2000s. However, the single biggest driver of this alternative finance wave is likely the Financial Crisis of 2008. Much of the big banks’ success has been based on their sterling reputations for security and reliability. Even today, banking executives believe that “reputation for stability” is their greatest strength when competing against new Fintech rivals.
Irresponsible subprime lending practices and risky decision-making put the entire U.S. financial system at risk when the housing bubble burst, and American taxpayers had to come in with massive multi-billion dollar bailouts for the big banks just to keep them in business. The reputation of big banks took a huge hit, and many disillusioned customers started seriously looking for alternative options for the first time.
Alternative finance has now established a firm foothold in the financial world. U.S. marketplace lenders generated $6.6 billion in loans in 2014, and the European alternative finance market reached $3.9 billion in size last year. Not only are these large numbers, the growth rates are staggering. The U.S. total in 2014 represented a 128% jump over 2013’s total, and the European number was up 144% year-over-year. It may seem like alternative finance has come out of nowhere in recent years, but a look back on history shows that the underlying principles of alternative finance have been around for centuries, and their power has been repeatedly demonstrated over time. Modern technology has allowed the benefits of alternative finance to be available globally for the very first time, and thousands of banking customers are already taking advantage of the opportunity.
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MoneyLion’s consumer and enterprise businesses were recognized as winners of Benzinga’s 2022 Global Fintech Awards at this year’s Fintech Deal Day
New York, December 14, 2022-- MoneyLion Inc. (“MoneyLion”) (NYSE: ML), the go-to destination for personalized financial content, products and advice, is proud to announce that it has been named “Best Financial Literacy Tool” at Benzinga’s 2022 Global Fintech Awards. MoneyLion’s enterprise business, Even Financial, was also named as the winner for “Best API.”
MoneyLion and Even Financial were honored alongside other top Fintechs, banks, research companies and more. MoneyLion’s consumer business continues to push financial literacy through innovative and personalized content. With the MoneyLion app, users can view personalized financial content in short-form video format and receive personalized financial product recommendations such as loans, insurance and investing. As MoneyLion’s enterprise offering, Even Financial digitally connects and matches consumers with real-time personalized product recommendations from banks, insurance carriers, and Fintech companies on mobile apps, websites and other digital touchpoints through its financial product search engine and Embedded Finance Marketplace technology. This technology powers both the MoneyLion Marketplace, in the MoneyLion app, as well as more than 1,000 enterprise partners.
“We’re thrilled MoneyLion’s consumer and enterprise businesses were recognized by Benzinga,” said Dee Choubey, Co-Founder and CEO of MoneyLion. “Both awards showcase MoneyLion’s every time you money approach to helping our customers. The financial literacy gap is a huge problem for millions of Americans and we remain committed to reducing its effects through engaging, informative content and key partnerships designed to bring an elevated educational experience to all.”
These awards follow the October announcement of MoneyLion University, where MoneyLion launched its latest initiative aimed at closing the gap in money and financial education across the United States.
“We could not be more pleased with Benzinga’s recognition of our company’s API technology,” stated Phill Rosen, CEO and Founder of Even Financial. “Our technology natively integrates real-time credit decisions and product recommendations from the industry’s largest network of connected financial services providers, offering access and choice to consumers searching for financial products. Our elegant Embedded Finance Marketplace, API and search engine enable any company to add trusted, personalized financial products and services to their business, reaching people when and where they need it.”
Even Financial has been named a listmaker for the Benzinga Global Fintech Awards for the last two years and was a previous award winner. In 2021, Even was selected as a listmaker for Best API and, in 2020, selected as a listmaker for both Best API and Best API Platform. In 2019, Even was awarded the Benzinga Rocky Award.
The annual Benzinga Global Fintech Awards take pride in recognizing and honoring the companies and individuals who are propelling the Fintech and financial services industry forward with the most impressive technology advancements and innovations. A panel of industry experts from a wide range of companies reviewed and judged the nominations. Winners were announced at Benzinga’s Fintech Deal Day on December 8, 2022, where MoneyLion’s Chief Customer Officer Cynthia Kleinbaum spoke on the panel, Expert Growth Hacks For Reaching Underserved Markets.
About MoneyLion MoneyLion is the go-to destination for personalized financial content, products and advice. MoneyLion’s mission is to rewire the financial system to positively change the path of every hard-working American. MoneyLion uses its proprietary data advantage and technology to empower its customers. MoneyLion engages and educates its customers with daily, hyper-personalized money-related and money-adjacent content that is delivered through each customer’s own content feed. MoneyLion provides its customers a full suite of financial and non-financial solutions, bundling its proprietary, low-cost financial products with products that are offered through its marketplace technology and network affiliate partners. MoneyLion also leverages its distinct data, technology, and network advantages to deliver leading embedded finance and marketplace solutions for enterprise customers. Since its founding in 2013, MoneyLion has empowered millions of Americans to take control of their finances and live their best financial life, every day.
For more information about the company, visit https://www.moneylion.com/ and https://www.evenfinancial.com. For investor information and updates, visit investors.moneylion.com and follow @MoneyLionIR on Twitter.
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New York, Jan. 11, 2023 -- Even Financial ("Even"), an independent subsidiary of MoneyLion Inc. (NYSE: ML), and a leading embedded finance marketplace platform, is proud to announce that it was honored in Built In’s “2023 Best Places To Work” Awards. Specifically, Even earned a place on the Hybrid Best Places to Work in New York.
The Best Places to Work Awards, now in its fifth year, honors companies across numerous categories, sizes, remote-first employers as well as in person and hybrid working companies across the U.S.
Built In determines the winners of Best Places to Work based on an algorithm, using company data about compensation and benefits, and also weighs criteria like remote and flexible work opportunities, as well as other people-first cultural offerings.
This announcement follows Even’s recent win at the Benzinga Global Fintech Awards for “Best API.”
About Even Financial
Even is the industry-leading embedded financial marketplace and independent subsidiary of MoneyLion Inc. (“MoneyLion”) (NYSE: ML). MoneyLion is a leading digital financial services and lifestyle content platform serving both consumer and enterprise customers. As part of MoneyLion’s enterprise offering, Even digitally connects and matches consumers with real-time, personalized financial product recommendations from banks, insurance carriers, and fintech companies on mobile apps, websites, and other digital touchpoints through its marketplace technology. Even's infrastructure leverages machine learning and advanced data science to solve a significant pain point in financial services customer acquisition, seamlessly bridging financial services providers (such as SoFi) and channel partners (such as TransUnion) via its industry-leading API and embedded finance marketplaces. Even enables any company to add financial products to its business, with full compliance and security at scale. Even was named one of "America's Best Startup Employers'' by Forbes for 2022 and was named to the 2021 Deloitte Technology Fast 500, which recognizes the fastest growing tech companies in the world. Learn more at www.evenfinancial.com and investors.moneylion.com.